Signal-Jamming in a Sequential Auction
AbstractIn a recurring auction early bids may reveal biddersâ€™ types, which in turn affects bidding in later auctions. Bidders take this into account and may bid in a way that conceals their private information until the last auction is played. The present paper analyzes the equilibrium of a sequence of ?rst-price auctions assuming bidders have stable private values. We show that signal-jamming occurs and explore the dynamics of equilibrium prices.
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Bibliographic InfoPaper provided by Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich in its series Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems with number 261.
Date of creation: Jun 2009
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Auctions; Signaling; Price Competition;
Other versions of this item:
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
- D02 - Microeconomics - - General - - - Institutions: Design, Formation, and Operations
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
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- Philippe Février, 2003. "He who must not be named," Review of Economic Design, Springer, vol. 8(1), pages 99-119, August.
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